YOUR WEEKLY VIRAL LOAD (OF NEWS)

As I write this tonight, the Nikkei (Tokyo stock market) has just opened and its index fund is down about six percent on the day so far because of virus panic, which is pretty bad. (For the sake of comparison, the biggest daily drops during the 2008 financial crisis which, you know, came close to bankrupting the world were about ten percent.) This is roughly on par with other major Asian stock indices right now - the South Korean index is down about five percent, the Chinese about three, and the Australian around four. This is more or less on par with everything else about Covid-19 thus far: it’s pretty bad, but it could be worse. (Granted, there’s still a few hours of trading left in the day in these markets while I’m writing, so maybe it’ll end up lower; maybe it won’t.)

Things are gradually getting worse as people start to understand the concept that Covid-19 tends to expand on an exponential growth curve - taking, on average, about 16 days to increase its infection load tenfold, which means that you can reasonably expect the infected count in any given area to increase by about 100 times in a month for at least the first couple of months. (At that point it will most likely start slowing down, partially because of safety measures and precautions and partially because infected people won’t be able to pass along the infection to uninfected people as easily, because there will be fewer uninfected people.) Japan has closed schools for a month; in Italy they’ve closed down all public museums. (Once again, I marvel at the fact that my wife and I basically went to Italy at basically the absolute last time for a while it would be possible to do all the fun things we did.)

Most of these measures are relatively unhelpful in reducing the absolute number of total cases of Covid-19 these countries will have to deal with, but that’s not really the point: the point is to reduce the infection curve, so at no point do their respective health systems collapse due to overstrain. (Or, to put it more bluntly: if you’re going to have 1.2 million people get sick, it’s better if you have a hundred thousand get sick every month for a year rather than have six hundred thousand get sick all at once.) This may or may not work, depending on a country-by-country basis. Italy, for example, is having real problems right now as Lombardy - the centre of their crisis - has a 15% hospitalization rate for Covid-19 sufferers, and their intensive care crisis unit is - in the words of their director - on the “brink of collapse.”

And then there’s the United States, where everything is being handled seemingly as badly as possible. Some of the reasons for handling the disease badly are in fact not entirely bad ones: New York, for example, is refusing to close schools except as a last resort, because they estimate that over a hundred thousand students in the system are homeless and rely on schools as a place to get food and medical care. (Yes, the fact that the welfare system has degraded to this point is itself kind of awful, but at least the teachers still give a damn, you know?)

Most of the reasons for handling Covid-19 badly, however, are bad reasons. Ben Carson is an inept fool who isn’t fit to oversee a major health crisis and he was replacing people who weren’t fit to do it either. There is no unified testing regime and in fact many states are being ordered to not test people who are sick, simply because the USA doesn’t have anywhere near enough testing kits. The USA is already starting to export cases of Covid-19 to other countries as a result of this despite having come to the infection party relatively late: they don’t know where it is or where it’s worst, they just don’t know anything because the country has no unified health apparatus that can take charge (or, more reasonably, is just in charge already), and every step that the country could reasonably take to prevent the spread of Covid-19 is one that’s impossible for them to do because of how the American economy works.

If you don’t want Covid-19 to rip through nursing homes, you need nursing homes to be properly staffed, but most American nursing homes are understaffed because that makes them cheaper to operate. If you don’t want sick workers infecting their co-workers you want the sick to stay home, but without guaranteed sick days those workers can’t afford to stay home, and most of their employers have warned them that taking time off to be sick will result in a firing anyway. If you want hospitals to have sufficient supplies of antiviral cleaning supplies and protective masks, you can’t let the free market profiteer off panic buyers. Oh, and the fact that mixed messaging on the virus has led to a not-insignificant percentage of American society to believe that it’s all a hoax doesn’t help either. It’s all a giant mess that is directly messier because of every bad American societal decision for the past forty years.

Anyway, while I’ve been writing all this, those stock indexes I mentioned above have all taken further downward hits, but that’s not just entirely because of the virus but also because of our second item:

I THINK THIS WAS IN THE PREQUELS TO THE MAD MAX MOVIES

Russia and Saudi Arabia have both started slashing prices on their crude oil reserves, and have both stated they plan to ramp up oil production and flood the market with cheap oil. This is bad - and not just for the usual environmental reasons you would expect me to write about. (Let’s just take it as written that drilling for more oil is, without debate, either outright bad or at best a temporary necessary evil. It is not good in any sense.)

The problem causing all of this is that Russia and the Saudis - who are both extremely dependent on oil revenues to not go broke - have been suffering for years because they had been holding back on oil production in order to try to keep prices relatively high, but the result of this was that shale oil production in the USA was economically competitive as a result, and for the last five or six years the Russians and Saudis have both been losing market share to the Americans as a result. Thus, this price slashing is essentially a declaration of economic war on the American oil industry - which is, you will probably not be surprised to hear, absolutely loaded with companies which are overextended with debt as they financed massive expansion, and which are now all likely unprofitable.

As for the Canadian context, it’s even worse. Tar sands oil - the focus of Alberta’s oil industry - was already barely competitive with shale oil, and a oil glut from Russia and the Saudis is something that Albertan oil will simply not be able to compete with no matter how many First Nations reserves Justin Trudeau sends the RCMP to. Alberta’s economy is going to get hit worse than North Dakota and Texas’ economies. (Saskatchewan and Newfoundland produce more traditional crude oil for the most part, but they’ll take hits as well simply because the drop in price will sting a lot.)

And as I write this the Australian stock index is now down seven percent on the day, which means the American markets will probably be taking a stiff hit as well.

THE ENTERTAINMENT SECTION

Movies rewatched this week:

Young Sherlock Holmes (1985, Barry Levinson, Amazon Prime Video) - 3/5

Nearly finished Arkham Knight, which - I said last week it was fine, and yeah, that’s about right. Not great; just fine. I don’t think Batman really works for an open-world game (certainly not one where all of the missions are so supposedly urgent) and there’s just too much “let’s tank fight with the Batmobile” bits - I don’t want to tank fight, I want Batman to beat people up and solve crimes!

See you in seven.